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The Rotten-Kid Theorem Meets the Samaritan's Dilemma

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Listed:
  • Neil Bruce

    (Queens University)

  • Michael Waldman

    (UCLA)

Abstract

Becker derives the Rotten-Kid theorem -- that a child will not behave in a manner which lowers the parent's income more than it raises the child's -- in a one period setting. Not captured in Becker's analysis is that the family environment can exhibit what others refer to as the Samaritan's Dilemma. That is, children may consume too much in early periods because by doing so they can increase the income transfers they receive in later periods. In this paper we formally consider the Samaritan's Dilemma and its relation to the Rotten-Kid Theorem in a two period version of Becker's model.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Neil Bruce & Michael Waldman, 1986. "The Rotten-Kid Theorem Meets the Samaritan's Dilemma," UCLA Economics Working Papers 402, UCLA Department of Economics.
  • Handle: RePEc:cla:uclawp:402
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    File URL: http://www.econ.ucla.edu/workingpapers/wp402.pdf
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    References listed on IDEAS

    as
    1. Becker, Gary S, 1974. "A Theory of Social Interactions," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1063-1093, Nov.-Dec..
    2. Bernheim, B Douglas & Shleifer, Andrei & Summers, Lawrence H, 1986. "The Strategic Bequest Motive," Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages 151-182, July.
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